Yet another set of local real estate firms are joining forces, further proof that reposition is vital amid current economic times.
Memphis-based The Regal Group LLC has announced its office will become First National Realty East – a division of Memphis-based First National Realty Inc., which also has offices in Jackson, Tenn., Jackson, Miss., Nashville and Little Rock with about 300 agents collectively.
The merger will provide agents the ability to compete effectively in a changing real estate market, said Cynthia Murrell, principal broker of The Regal Group. With a new ownership structure, Murrell will offer agents the option of affiliation with a traditional Realtor board like the Memphis Area Association of Realtors or the Mid-South Real Estate Board or remain in business as a non-affiliated independent real estate agent.
“The two divisions will enhance our ability to operate competitively,” Murrell said. “It provides us the opportunity to protect the business and livelihood of our agents.”
Murrell initiated discussions after considering a transition to First National Realty’s business model for several years.
First National Realty is a flat-fee transaction-based company where the agents retain 100 percent of the commission, said Larry Mayall, First National Realty broker who sold the business to his daughter, LaDonna Thomas, last year.
“We’re like a big-box retail approach to the real estate business,” Mayall said.
One of Murrell’s primary objectives was to operate as a virtual and paperless business. First National’s systems will position the new Memphis office to become one of only a very few agencies in this metro market to offer this service to its agents.
“I looked at other areas that had already adapted to this model of real estate – it empowers agents and it keeps the real estate business thriving as a career,” Murrell said. “I spoke with the state and they’ve just been inundated with agents retiring licenses and I think they should have an option, and here they do.”
First National also offers a 100 percent commission structure for real estate agents, which was appealing to Murrell, who’s office currently has five agents, with a projected goal of up to 100 agents by April.
“Few agencies have been willing to modify their approach to the commission structure during this difficult and unprecedented time in our industry,” Murrell said. “The 100 percent commission plan will empower agents to remain in business and continue to serve their clients.”
Technology offers the greatest influence and opportunity, Mayall said. The traditional firms are faced with a difficult challenge because of the amount of overhead and inability to adapt.
“The philosophy at First National is that we empower agents to provide the most efficient services to buyers and sellers of real estate,” Mayall said. “That empowerment is a full, comprehensive approach to helping that agent become a true entrepreneur, a true independent contractor, to understand that they have to be more than just a sales person, they have to be a marketing person and build an understanding of how important that is in the structure of their individual business. I think that’s what’s missing in so many of the traditional firms.”
Mayall launched an independent realty organization, the Mid-South Real Estate Board, in August.
Many firms are tackling the housing slump through joint ventures. Recent announcements include Coleman-Etter, Fontaine Realtors’ merger with Crye-Leike Realtors Inc. and Kendall Haney Realty Group’s union with Austin, Texas-based Keller Williams Realty Inc. In both cases, smaller, local firms teamed up with national brands in order to re-align and stay competitive.